It is well known wisdom that good idea is not necessarily a good business, so first things first – TEST your idea or niche. Do not look for niche or market that has no competition. No competition – most often means no market. Lots of competition is good – more products to promote in the marketplace, more potential partnerships to create, more mutually beneficial joint ventures to found.
Here are few online places you can check which products, services or markets are currently active:

Download.com – there you can search and sort and see which products are active. Which ones are praised and receive lots of good comments. Visit vendor’s pages and see if these have affiliate programs attached to them.

Type search queries on Google trends top see if they are active. Compare search queries to each other. Compare and see which countries, regions and even cities are actively (or not so) are searching. Have fun with Google Hot Trends to see which search queries are very active right now! Fun to object trends and get ideas.

Check Digg.com for entries that received the highest number of “diggs”. These should give you an ideas of what popular among opinionated geek crowd (in case you want to target this market). Blaming Bush, praising Obama, Apple and Firefox seems to be the hot topics.

Find out the most expensive adwords, type them on Google, look at their ads and see what these portals are doing. They paying a lot of money for every single click (sometimes $50 and more) and they presumably very successful businesses. Great to observe and learn from.

Check Ebay on what are the hottest selling items. This is the page not many people seems to know about – most popular items on Ebay. Great to observe and study current trends.

Once you figure out your area of marketing – create simple website with just one landing page promoting affiliate product. Be willing to spend $50-$100 to test the market, test how responsive are visitors and whether you see any conversions. Don’t expect to make money right away (although it’s perfectly possible) but if you don’t see any conversions after spending $100 on Adwords – this might be a sign of not-so-good niche to be at. If you see sales from this test campaign – you know that you have a chance to make money money and improve from now on.
Alternatively to selling a product – create an opt-in page that gives some useful information to your target niche and inviting people to signup to your list. Aweber is a popular, flexible and reliable service to do email marketing. This way you ad dollars will be spent on generating a list to which you can market on forever.
Remember – having mailing list of targeted interested people will allow you to make money instantly, sometimes by sending a single email promoting new affiliate product.

If your list is growing, sales are happening – this will be a good time to grow. Start adding more contents to your site. Have capability for people to ask questions through your website. Make every effort to make it easy for people to join your list.
Every time you add a new page to your page – use great free service OnlyWire to quickly notify many other social tagging, bookmaring and linking sites about your new pages.
Use pingomatic.com and ping.in to notify blogging engines about your new pages.

Remember – affiliate programs are easy as they does not require one to create much of anything. People love to be lazy and make money fast without doing anything. As a result of it – approaching business from the “I wanna be affiliate” side has it’s limit. The real money on internet and beyond are in having your own product. After tests above you observed that niche is good an active.
Start creating your own product targeting this niche and this will put you in command. Invite other people to become affiliates to market your product.

Play with creating super simple products and “magnet” pages:

Promotional Videos. Buy e-book or product or join membership site of your interest that has affiliate program with it. Create simple guidance video explanaing benefits of the product and guiding visitor on how to use it. Have video showing your website and sign up URL with your affiliate link for the product. Videos are great way to attract targeted converting traffic and make extra sales.

Create Frequently Asked Questions about popular product or service and place your affiliate links around it. If page has useful rich contents – it will eventually attract free organic traffic of potential customers. You may speed up the process with the help of onlywire.com and pingomatic.com